State employee labor unions were back in a Tallahassee courtroom Monday, trying to block Gov. Rick Scott's administration from outsourcing all health care for inmates in the nation's third-largest prison system. Leon County Circuit Judge John Cooper posed questions to both sides for nearly two hours and promised a quick ruling.

"There's a lot on the line here," Cooper said.

The Department of Corrections has a signed contract with Corizon Healthcare to take over health care operations in central and north Florida prisons by mid-January. The state is still negotiating with Wexford Health Sources, which won the right to operate prisons in South Florida. Both vendors have said the overwhelming majority of their employees will be state workers displaced by the privatization.

But a negative court decision would be bad news for the state. Prison health care unions are challenging the state's authority to outsource inmate health care without a specific appropriation from the Legislature in the current budget. The unions say it's improper for the prison system to move forward with the project based only on approval from the Legislative Budget Commission (LBC) in September.

The unions argue in court papers that the only specific appropriation to privatize prison health care operations in the current budget is for $41.4 million in the South Florida region only, and that it's contrary to state law and the Florida Constitution for the LBC to go beyond that.

In court, Jonathan Sanford, an assistant general counsel at the prison system, said the LBC simply allowed an accounting transfer, as requested by the governor's office, to let the privatization proceed. "I think that's standard procedure," Sanford said.

But neither side's lawyers, nor Corizon attorney William Williams, sounded very authoritative in explaining how the legislative budget process worked in this case. "It's a fairly arcane process," Williams told the judge, who asked all sides to file legal memoranda by Nov. 28.

The unions left the courtroom hopeful they have a chance to thwart the project from moving forward after seeing the judge hone in on the LBC's power. "I feel good about the issue, and the judge did recognize that it was an issue," said Tom Brooks, attorney for the employee unions.

Florida
religious leaders, labor unions and senior citizens marched to the state
Capitol on Monday to protest a proposed constitutional amendment they say will
lead to massive cuts to education and crucial social services.

Calling the revenue-capping Amendment 3 a “wolf in sheep’s
clothing,” the group of about 50 said the proposal would slash education
funding and pit seniors against the poor in a scramble for limited state
dollars.

“This will not be good for the great citizens of the state
of Florida,” said Rev. Richard Dunn, a Miami
pastor and former city commissioner. “It will not be good for our children, it
will not be good for our seniors and it will not be good for the middle class
people.”

Amendment
3 proposes to change the way state revenue caps are set—using a formula
based on population size and inflation, rather than personal income growth.
Once state revenue from taxes and other sources exceeds the new caps, excess
money would be used to shore up a budget stabilization “rainy day” fund.

Proponents of Amendment 3—which include business groups—say it
will force state lawmakers to spend more wisely and avoid overspending during
times of economic growth.

"The less government takes, the more Floridians will keep," said Edie Ousley, a spokesperson for the Florida Chamber of Commerce. "Voting yes on Amendment 3 will send a message to our state leaders that the size of Florida’s government shouldn’t grow faster than the taxpayers capacity to pay for it.”

Outgoing Senate President Mike Haridopolos, R-Merritt
Island, was a major
backer of the “smart cap” amendment, saying it would lead to “less, government,
less taxes and more freedom.”

After the proposal was approved by the Senate last year,
Haridopolos released a video calling it “a common sense idea that finally makes
sure that government spending never grows faster than family income, meaning
when the economy recovers we will not overspend.”

But opponents—who have begun to mobilize in religious
groups, labor unions and senior communities—predict a much grimmer scenario.

Quietly, over the past six years, an experiment in providing
healthcare for the poor has been playing out in Broward and four other
counties around the state. Its basic goal is to relieve the financial
pressures of Medicaid on Florida’s taxpayers by turning over poor and
disabled patients to private companies, a move lawmakers believe will
cut costs.

Conservatives love the Medicaid reform program,
pointing to an in-depth University of Florida study indicating that the
experiment has lowered costs while not raising consumer complaints. The
Legislature has already approved a slightly modified model of the reform
to go statewide. At least one national think tank believes it should be
a model for the entire country.

Liberals decry the effort as a
way to build corporate profits at the expense of the poor. Howard
Mallinger, a Sunrise retiree, thinks they’re right. He has two adult
sons with mental health problems who are in a Medicaid health
maintenance organization. The HMO frequently
won’t provide their medications, or is slow to approve them, causing
their health issues to spiral out of control, Mallinger says.

One son has been involuntarily committed under Florida’s Baker Act
44 times in the past five years, he says. That often means expensive
three-day hospital confinements. “The joke is on the taxpayer,”
Mallinger says.

Florida residents are among the poorest in the nation as median income in the state dropped 2.9 percent in 2011 and the state had some of the broadest gaps in income equality, according to 2011 U.S. Census Bureau data from the American Community Survey released on Thursday.

The survey also found that the income gap in Florida widened by 3.6 percent in 2011, a reflection of the state’s stagnant unemployment and slow jobs market. The income disparities in the state also remain among the highest in the nation, although they are on par with other states in the Southeast.

Seventeen percent of Florida’s population – 3.1 million people -- lived in poverty in 2011, up from 16.5 percent in 2010 and above the 15.9 percent national average. According to the survey, 48.5 million people had income below the poverty rate in the U.S., 2.2 million more than the year before.

The company awaiting final approval from Gov. Rick Scott's administration to privatize health care services for most Florida prison inmates has agreed to pay a $1.85 million fine in Philadelphia for skirting minority contracting requirements. The vendor, Prison Health Services, now known as Corizon Health, is accused of falsifying official documents and federal prosecutors are looking for evidence of mail and wire fraud.

News accounts in Philadelphia newspapers report that the city's inspector general, Amy Kurland, as describing the arrangement as a classic "pass-through" in which health care for city jail inmates was subcontracted to JHK Inc,., a female-owned business in Indiana that handled pharmaceutical supplies. The company said it had permission from prison employees for the arrangement.

Philadelphia Mayor Michael Nutter called the city's settlement with the company"a significant moment that sends a very, very strong message to everyone who does business with the city," the Philadelphia Inquirer reports.

As the story was breaking in Philadelphia, Scott's Department of Corrections was formally asking the Legislature for approval to shift $58 million in health care funds across categories so that it can hire Corizon and a second private vendor, Wexford Health Sources, by January 2013. The request for a budget amendment is pending before the Legislative Budget Commission and appears below.

To All Legislative Members:This Budget amendment is pending approval by the Executive Office of the Governor and requires LEGISLATIVE BUDGET COMMISSION approval. If the Commission chairman elects to agenda this amendment it will be implemented on 8/8/2012.

Budget Amendment Request #:

B0096

Requested by:

Department of Corrections

Problem Statement:The department has requested and received proposals for the statewide privatization of comprehensive health services. In order to award the contracts, budgetary action is needed to transfer funding to the appropriate category.

Agency Request:The department requests to transfer $57,668,391 in General Revenue to the Inmate Health Services budget entity, Inmate Health Services category from the following categories within Inmate Health Services: Salaries and Benefits $ 37,535,005 Other Personal Services 12,875,012 Expenses 6,697,952 OCO 199,229 Contracted Services 361,193 Approval of this request will enable the department to move forward with the statewide privatization of comprehensive health care services based on a January 1 implementation date.

EOG Recommendation: Recommend approval for the transfer of $57,668,391 in General Revenue in the Department of Corrections between various categories within the Inmate Health Services program. The transfer is necessary for the department to move forward with the statewide privatization of comprehensive health services with an anticipated January 1, 2013, implementation date.

Florida will spend $47 billion this year hiring outsiders to provide goods and services for the state but hundreds of the contractors will not be required to show they provided services they agreed to and their documentation will be rife with errors.

Those are the conclusions of Chief Financial Officer Jeff Atwater after a sample audit of the 24,000 state contracts at 33 different agencies found that 35 percent were flawed.

At stake, he said: "Hundreds of millions of dollars" of the state's $70 billion budget, 67 percent of which is outsourced.

On Wednesday, Atwater unveiled a new web site that details most of the state's contracts so the public can determine if they are being held accountable for the services they are offering. The goal, he said, is to put the heat on the flawed contracting system by turning the public into watchdogs and inviting more competitors to the table.

Lisa McKerracher might set up a spinal-cord lab in Miami, or she might set it up in Massachusetts. Florida will pay her $83,000 to pick the Sunshine State.

“I’m not sure this is where I need to be,” McKerracher said from her temporary office in Dania Beach. “I’m going up to Boston in two weeks to look at space.”

McKerracher’s quandary captures the high and low stakes involved as Florida uses tax dollars to woo companies that may add jobs in the state. In the last two years, Florida’s economic-development agency pledged about $155 million in rewards for companies planning to add jobs in the state either with new locations or expanding their current ones.

BioAxone Biosciences, McKerracher’s fledgling company, hopes to create a new drug for paralysis victims, making it the kind of research firm South Florida pines for as it tries to move its economy away from depending on tourism and real estate. But McKerracher only plans on hiring 12 people tops for a small lab at the University of Miami’s new commercial research building, representing a tiny win for a region that has lost 134,000 jobs in the recession.

South Florida relied on modest deals like McKerracher’s for the nearly $12 million in pledges from Enterprise Florida, with smaller counties receiving larger grants. Of the 20 largest Enterprise grants since 2011, none were in Broward or Miami-Dade. The biggest was April’s $14 million pledge to Embraer Aircraft in Brevard for a new facility designed to add 650 jobs.

The largest payout in South Florida went to Saveology.com, an online discount site slated to get $1.5 million for moving from Fort Lauderdale to a larger headquarters in Margate. The relocation includes plans for 750 new employees, and prevented the company from accepting offers from other suitors, including San Francisco, said Bob Swindell, president of the Greater Fort Lauderdale Alliance, Broward’s economic development agency.

The incentive numbers were revealed late last week when an official from Florida's Department of Economic Opportunity inadvertently released a confidential database in responding to a public-records request from Integrity Florida, a nonprofit research group in Tallahassee focused on ethics reform. The database showed some pending offers that otherwise would have remained secret. South Florida’s list mostly involved companies already in the area, or moves that had been made public.

When a politically connected company was in danger of losing a $9.4 million no-bid contract with the state, Senate President Mike Haridopolos came to the rescue of the outfit — a firm that employs his good friend and political benefactor as a lobbyist.

Haridopolos staved off the threat to the deal with the Department of Juvenile Justice and quietly steered $6 million in additional dollars to the company, despite the vigorous objections of agency leaders and top Republican senators.

The move allowed Evidence Based Associates, a Washington-based probation program, the exclusive contract to handle the state effort to divert at-risk youth from costly prison beds into community programs. The company kept the business despite recent reports that it had failed to comply with key terms of the agreement —– and to the chagrin of a long list of providers who wanted to compete for the work.

The company’s lobbyist, Frank Tsamoutales, is a Brevard County Republican who has been a financial backer of Haridopolos since the Brevard County legislator was first elected to office in 2000. He went to work for EBA in April 2011, earning between $20,000 and $29,000 in the first year, the same year Haridopolos became Senate president.

"What I've asked our universities and our state colleges is, first, step back and do what Florida businesses have to do," Scott told reporters after the signing Tuesday, amid talk about the Florida College System's tuition increases, which are set at just 5 percent in the state budget. "What costs can we have and what costs don't make sense? I want all our state colleges and our universities to step back and say, are there costs we don't have to have?"

Reporters asked him whether he meant that universities should limit their tuition increases, normally allowed to rise up to 15 percent, to that same 5 percent. Scott said: "I'm very comfortable the Board of Governors will do that sort of review and the right thing will happen."

The Florida Board of Governors quickly put out a statement praising the Legislature for funding some university construction projects and for its cooperation with the board in setting accountability metrics -- even while cutting $300 million from the state university system. The statement included a note for media, saying the 5 percent tuition hike Scott was talking about applied just to Florida Colleges -- not universities.